Posted
by
Soulskillon Wednesday June 05, 2013 @05:13PM
from the bring-me-an-eggplant-and-a-belt-sander dept.

curtwoodward writes "Amazon has been delivering groceries to people in its hometown of Seattle for a half-dozen years, but the experiment has never spread any further. But this year, rumors about Amazon Fresh expanding to new cities are coming out every month — Reuters just reported that Amazon could start the service in L.A. within a week, and in San Francisco in the coming months. What gives? Why expand now? Look no further than Amazon's long-running battle with state and federal governments over sales tax policy. After more than a decade of resistance, Amazon has spent the last two years cutting deals to collect sales taxes in states all over the country. And it's pushing for a national online sales-tax system, which appears to be within reach. That's the last obstacle to Amazon getting into the grocery-delivery game — a step that should worry not only grocers, but UPS and FedEx, too."

So in other words, Amazon has managed to lobby legislators into having a national internet sales tax which it can fairly easily implement (since it designed it and is a large company after all) in order to screw over both the average Joe AND make the playing field less competitive (the US tax code is far from simple...)

Amazon has fought against internet sales tax (or, rather, the idiocy of making people who don't live or work in one state paying taxes in it) for quite a long time. They only recently caved in and gave up bothering to fight. Remember, they even went so far as to shut down their affiliates program in response to states trying to force out of state companies into paying their sales taxes (the residents' duty to do so).

It seemed clear that when they gave up bothering to fight against it, they had something planned. This seems like what it was. "Well, if you can't beat them - join them".

I say, good on them. All of these idiots out there perpetuating this myth that the lack of enforcing out of state collection on state sales taxes was harming the little mom and pop stores in cities . . . little mom and pop stores that no longer exist. Not because of "the intarwebs", but because of the big national chains that already squeezed them out decades ago. They had this crazy idea that if you suddenly had to pay sales tax online, you would stop shopping at Amazon and Newegg and other outlets online and trudge across town into their stores to deal with their shitty staff and shitty stores and shitty checkouts and shitty parking lots and all the other BS that goes along with it.

Instead, they're going to find that people who weren't going to shop at Best Buy, Walmart, Target, Lowes, Home Depot, Ralph's and so on without sales tax collection will *still* do so . . . because if you're going to pay sales taxes either way, you might as well have the pleasure of the things showing up effortlessly at your door step the next day or two. In fact, they'll probably find a lot of people who will do whatever they can to throw their business to online services just to spite them.

I've spent probably $500 at Amazon in the last few months and I have to pay sales tax (KY). It shows up in 2 days. (And if it ships from the distribution center in town the next day). Excellent return policies. Usually the cheapest price and I can do it from my couch without having to drive to the store.

And because Mom and Pop stores suck. I worked for a few in my teen years. Without fail they were the ones most likely to scam customers, paid workers far less, generally treated them worse, had worse prices and terrible selections.

The companies who competed with Amazon, said they did. If I shop at Store X to pay $n, whereas the same item at store Y costs me $n*1.1, store Y's assertion that they have a.1 tax rate, really isn't something they made up, pulled out of their ass. You might be right in saying they don't "pay" the.1 tax, but oh, it's there and it matters in a major way as a market force. It's just as if they were paying it.

Be careful whereof you pontificate. Different states have different laws.

In California, what you said is largely correct. The seller is responsible for remitting the sales tax to the state, whether it was collected from the purchaser or not. In fact, if the seller collects less than is due, the seller must remit the full amount due; if the seller collects more than the amount due, the seller must remit the entire amount collected (i.e. can not keep any overcharged tax).

Easy for a large multinational with full-time tax attorneys on staff to implement.

Painful for small businesses.

(not too unlike Health Care - which is easy if you have a HR department with nothing better to do; but is really painful if everyone in your company is trying to get work down that's relevant to your main business)

Easy for a large multinational with full-time tax attorneys on staff to implement.

Painful for small businesses.

Part of the deal in this interstate sales tax bill is that participating states will make TaxCloud.net available to online retailers without charge. Integrating TaxCloud.net into a cart is supposed to be no more painful than integrating a payment processor or a shipping rate service.

Integrating TaxCloud.net into a cart is supposed to be no more painful than integrating a payment processor or a shipping rate service.

When someone else assures you across the board that integrating something of theirs is [some level of difficult], into something of yours, where they know exactly nothing about your situation, work load, code, or available resources, you can be absolutely certain they have no idea whatsoever what they're talking about.

Further, for systems that implement home-grown shipping and payment, even the context is meaningless. "no more difficult" could be extremely difficult.

There are systems out there for whom the developers aren't even available any longer.

Whenever the government decides they're going to make every business, everywhere, do something, the load will neither be equal nor fair, and further, it may be fatal to the business for any number of reasons.

sales tax is far far more than states, counties and cities all have their own extras.

The impression I get from the TaxCloud.net TOS [taxcloud.net] is that participating states have entered applicable data for their respective counties and cities into the TaxCloud.net system:

1.11 "Tax Jurisdictions of Record" means all applicable state, county, regional, tribal, or special tax district jurisdictions for a particular TaxCloud Transaction, as determined by at least Section 309 and Section 310 of the Streamlined Sales and Use Tax Agreement.

Easy for a large multinational with full-time tax attorneys on staff to implement.
Painful for small businesses.

Isn't it funny how that works?
Same with tax-code -- theoretically, everyone is subject to the same tax codes. However, people with several full-time attorneys on staff seems to do a lot better in minimizing their tax bills.
Coincidence?

Its easy to implement for Amazon because Amazon is a large company with a team of lawyers and helped design it. In 2012 Amazon had revenue of about 60 billion or so, spending a couple hundred thousand (or more) on compliance with this proposal is a very small dent. However, the cost of compliance will be felt much more for smaller companies or individuals who sell online and may very well put them out of business. After all if you're selling something as a hobby, its not going to be much fun or profitable if you have to spend hundreds of dollars on either talking to a tax attorney or several man-hours trying to figure out the taxes on your own. Amazon can afford that, they've got the personnel and the spare cash, your "mom and pop" style internet store may not.

So before, Amazon was unfairly competing with local brick & mortar stores because they didn't have to pay the same sales tax.
And now you're saying that they're unfairly competing because they do have to pay the same sales tax?

No, Amazon will unfairly compete with other online stores, because small online stores will not be able to afford a dedicated department (with several attorneys) for the sole purpose of online tax collection.

The playing field with brick&mortar stores may even out a bit as a result, but B&M stores probably still wouldn't have enough in-stock items to remain competitive.

"So in other words, Amazon has managed to lobby legislators into having a national internet sales tax which it can fairly easily implement (since it designed it and is a large company after all) in order to screw over both the average Joe AND make the playing field less competitive (the US tax code is far from simple...) "

It's worse than that, since a "national internet sales tax" is unconstitutional, despite what the Supreme Court previously said about the possibility.

I have laid out the reasons why several times, at length, here on Slashdot. I really don't feel like doing it again today.

What they are referencing here is not a national internet sales tax. And Congress may regulate trade between the states. Explicitly. So there is not even any question of whether this is or is not constitutional. It's a change to federal law to allow states to bill non-resident entities for taxes that would be owed if resident, but aren't owed currently. No new taxes are levied. They are just collected from a different point, and *never* by the feds. The Constitution has no problems with that.

Amazon wants to have distribution centers in all markets with their own delivery system. The problem is, that makes them a local seller and obligates them to collect state sales tax, just like WalMart. Instituting a law that gives states the right to collect sales tax on internet sales keeps everyone else from undercutting them on price with shipped interstate sales.

Right, because clearly less profit = more incentive to start a business! Clearly more paperwork = more incentive to sell online!

There's a reason why there's lots of small online stores: because you don't have to deal with the headaches of a "traditional" store, you don't have to get a business license, you don't have to fill out paperwork to get a tax ID, etc. I can sell online in minutes instead of weeks. I can spend most of my time making and creating my product rather than worrying about how to run m

wonder what part of "national sales tax" you missed. Everyone gets to pay sales tax on internet purchases going forward.

The part where that didn't happen.

As I just said in another post [slashdot.org], there's no "internet sales tax", just the ability for states to require internet retailers to collect sales tax on sales to residents. If a state has no sales tax, there will continue to be no sales tax.

(I make no statement on whether the federal bill/law is good or bad, just that the name "internet sales tax" is apparently

As I just said in another post [slashdot.org], there's no "internet sales tax", just the ability for states to require internet retailers to collect sales tax on sales to residents. If a state has no sales tax, there will continue to be no sales tax.

And if a business in such a State sells something to someone living in Kenner LA, they'll have to be able to figure sales tax for LA, Jefferson Parish, Kenner, and such sales tax holidays as might be applicable on any particular item at any particular time...

You missed it. There's no federal sales tax; it's still just state sales tax on the state you live in. In NH, there's no state sales tax, so we don't have to pay any despite this. What does change is that our NH businesses have to collect tax on behalf of other states when you buy from us online. So when you guys buy stuff online from our businesses, they'll now have to collect sales tax for your state. That's why we fought it, not because consumers would have to pay more, but because our businesses will ha

There is no national sales tax. The push was for a centralized tax system. Alaska, NH, and others will still collect no sales tax. The problem was places like Dallas, where the city spans multiple counties, and the sub-area taxes are precinct-driven (things like DART - public transport). So neighbors with the same ZIP code could have had different tax rates. That level of granularity is not captured by anyone other than specialist tax-tracking firms who exist solely to sell databases of addresses to ta

I wonder what part of "national sales tax" you missed. Everyone gets to pay sales tax on internet purchases going forward.

While that's what you'd think from the words "national sales tax", it is completely wrong. "National sales tax" is an inaccurate label (just like the more popular "internet sales tax" for the same measure was.)

The actual measure at issue that has been dishonestly described as a "national sales tax" or "internet sales tax" is federal legislation specifying particular conditions under whic

There is no national sales tax, there is no Internet sales tax. There is just a law that requires sellers collect appropriate taxes for the location of the sale. Taxes due do not change, just a minor change to who collects them, and from whom.

Same here in Texas... Helmets are optional if you have health insurance and are over 21.

Of course, having an accident on a motorcycle and not having a helmet is pretty much an example of Darwin's natural selection process in action... Strike that... RIDING a motorcycle in an urban area in Texas is an example of natural selection processes, folks drive crazy round here....

Nah, riding a bike is safe. You are more liekly to avoid them, and the Texas drivers are so bad that they don't see you if you are in a bike or a car anyway, so you drive both as if invisible, the difference is that on a bike, you are much more maneuverable. Why yes, I did ride a bike in TX, and never had a car hit me.

I'm wondering, though. For package goods it's fine. For perishables like meat, dairy, refrigerated goods and so on, it's a bit more complicated. The supermarkets (Vons in my area) already have the distribution network and storage in place in every store they have. All they need to do for delivery is pick the stuff off the shelves (or out of the back room before it goes on the shelves), put it in a truck and go. It'll be interesting to see how Amazon deals with keeping perishable goods in stock close enough

Its the whole point. Amazon would centralize its operations to avoid taxes. Now, its customers are getting hit by sale taxes ANYWAY. So they're just putting distribution centers all over the place, since they're not gaining anything by keeping them in the middle of nowhere.

With that, comes same day shipping as well as localized warehouses. Those two together is the only thing you need to effectively be able to do groceries.

The brick-and-mortar brigade has been bitching for years about the supposed "unfairness" of "they don't pay sales taxes but we do." They finally browbeat Congress into doing something.

Amazon's argument was about the burden of having to keep track of over seven thousand districts (I looked this number up.), having to update them the moment things change, and the legal penalties for any failure to keep track of changes. So they asked for, and got, a national single-tax regime, which, presumably, any business selling online can keep track of and meet, including the brick-and-mortarsaurs.

And if this is a disaster for the mortarsaurs, they will have only themselves to blame for the new K-T boundary.

It's not just that there are 7000+ districts, but they all have their own rules. Back in 2010, Washington had an extra tax on candy. However, Kit-Kat bars were exempt and charged at a normal food tax rate. Why? Because they happened to contain flour and were considered a baked good. Imagine trying to handle thousands of different jurisdictional rules across the millions of products Amazon carries. It'd be insane!

This has nothing to do with sales taxes. That's a few percent. It's all about efficient warehouse and distribution operations. Doing that wrong can double operating costs.

WebVan [webvan.com] was a popular service during the dot-com boom. They just had an operating cost problem. They had about 3% market share in 30 cities, instead of 30% market share in 3 cities. So their order processing and delivery costs were too high.

One of WebVan's former executives realized that order processing had to be much more automated for this concept to work. So he founded Kiva Robotics. [kivasystems.com] Upwards of 15% of online orders are handled by Kiva robots. If you've ordered from a major online retailer, (Acumen Brands, Drugstore.com, Gap, Toys-R-Us, Walgreens...) a Kiva robot probably handled the order.

Last year, Amazon bought Kiva Robotics. The whole company. Then they started building warehouses near major US cities and talking about same-day delivery. Those warehouses will have a lot of Kiva robots and not too many humans.

While some grocery chains like Safeway do delivery, they're not very good at it. They're picking from store shelves. So they don't know, when the order is taken, if the item is in stock. Safeway tends to deliver with some items missing. Automated warehousing operations know what they have in stock when the system takes the order.

It's going to be like Webvan again. But this time, it will be profitable. The retailers who see this coming are very afraid.

Uh, you are aware that Amazon's profit margins are typically only 'a few percent'?

The brick and mortar stores who complained that Amazon was unfairly competing with them by not charging sales tax are now going to find themselves having to compete with Amazon when they have local operations and same-day delivery. Good luck with that.

While some grocery chains like Safeway do delivery, they're not very good at it. They're picking from store shelves. So they don't know, when the order is taken, if the item is in stock. Safeway tends to deliver with some items missing. Automated warehousing operations know what they have in stock when the system takes the order.

If that's the level of service that they're providing, the world will be a better place when they're out-competed. Sucks if you're a Safeway employee, but reduces the level of suck for many other people so it's a net gain. That's the reality of a proper free market. (And having shopped at Safeway in the US, the sooner they get replaced, the better IMO. Horrible place.)

They will soon if they end up delivering groceries. They'll have trucks, drivers and people paying delivery fees. Amazon just got in the delivery business. Next up they'll start offering it to others and get a cut of that money too.

Okay, lets take your example of Supermarkets. Most of them are union. The only major non-union Supermarket in my area is Wal-Mart. Working for a Union outfit, I do have to pay more in union dues. But I make whole hell of a lot more working for a union place than I ever would at Wal-Mart. Everyone I know at Wal Mart is on the edge, barely making ends meet, and on assistance programs, such as Food Stamps, TANF, etc. (California already recognizes the problem here, drafting a new law where by places where work

The only major non-union Supermarket in my area is Wal-Mart. Working for a Union outfit, I do have to pay more in union dues. But I make whole hell of a lot more working for a union place than I ever would at Wal-Mart.

Why should anyone care? Do you care about us? What does the union do for anyone besides the union?

Everyone I know at Wal Mart is on the edge, barely making ends meet, and on assistance programs, such as Food Stamps, TANF, etc.

Does the union support politicians who want to shrink these programs? No. They do not. They support politicians who want to expand these programs. Unions are part of the problem. For this reason alone, I hope Amazon and Wal Mart and all the non-union alternatives displace the union supermarkets.

Why should anyone care? Do you care about us? What does the union do for anyone besides the union?

In many businesses, unions insist that the same treatment be provided to non-union employees. If you don't join the union and pay your dues, you don't get to participate in collective bargaining sessions, but you still benefit from whatever was achieved by the union in collective bargaining.

In some countries (that can boast a high standard of living), this is how minimum wage is set. The government doesn't get

You do if you want to keep your grand children out of the coal mine. The plutocrats who abuse their employees are still in power and work day and night to undo the protections that the unions have put in place for American workers. The price of freedom is eternal vigilance.

Oh. there are plenty of things that unions are still fighting for, living wages, proper healthcare, collective bargaining, etc. But the gains to workplace safety and child labor laws that have been mostly won are still under constant attack by the right. And without vigilance those will fall and we will see an end to the middle class and our future generations fed to the economic machine for the enrichment of the monied elite.

The defense of these things will be necessary as long as the right continues to attempt to strip and neuter the laws and agencies that are supposed to represent the workers interests. Why do you think they call for the end of the the EPA and OSHA and other protective government agencies? Every workers right and workplace safety is under constant attack by the right.

What? Like only 6 weeks of vacation a year? Or only 3 months notice from your employer when they lay you off with guaranteed time off for interviews. 35-hour workweeks? Siesta rooms for lunchtime? Yeah, I've heard working in the EU really sucks.

What you are describing is (with the exception of generous holidays) a feature of Western Europe. Come to the EU countries in Central and Eastern Europe and it's not so rosy. I'm in Romania, and I can assure you that business owners are out to screw you any way they can.

Tell it to someone from 50 years ago. Today's union bosses have been trading off work their great grandfathers did for long enough. What do they have to offer anyone in the future besides cronyism, coercion, and corruption? Expensive and inconvenient groceries?

As the CEOs get more and more of the profits as pay, the need for unions increase. 10 people conspire to share money to make money, and they are capitalist heroes. 10 people conspire to agree to terms to make money, and they are socialist villians. Why do you hate free association so much?

Slavery actively prevents a middle class and pretty much ensures that everyone is either rich, poor, or a slave; labor is not a reoccurring cost as it would be with a free man, so the poor can't become middle class through their own hard work.